The point of this street-level story is to show how Canada’s broadband oligopoly works in practice, especially the incumbents’ freedom to collect economic rents as ISPs – i.e. charge prices they would never get away with in a competitive market.
Rogers drives a furious customer into the waiting arms of TekSavvy
I’ve known Jacky and Jimmy* for many years (*not their real names). They’re a happy, successful couple raising a terrific teenage daughter. But after months of terrible service as Rogers subscribers, they were anything but happy. In due course I got a phone call from Jimmy, who was beside himself, wanting to be rescued from their ISP hell. And btw, would I still recommend TekSavvy? Continue reading →
Bell’s CRTC whisperer, Mirko Bibic, got bent out of shape when he saw the CRTC’s annoying interrogatories Friday morning
Today saw another encouraging step in the CRTC’s management of the Ben Klass Part 1 application on Bell’s Mobile TV service. You can get the backstory in my prior posts (first one was in November) and from Ben’s blog, among other places.
That step was the interrogatories sent to Bell officials, asking for detailed information on Bell’s network architecture, subscriber invoicing, content exclusivity and competition, among other things. I’ve pasted in all 10 of the Commission’s questions below. A couple of comments in the meantime…
First off, the language of the questions demonstrates that the Commission is taking Ben’s application to heart, and that it sees a prima facie case against Bell for violating telecom rules. On one crucial point, whether Mobile TV is simply a broadcasting service as Bell claims, the Commission staff want to hear an explanation of the “inconsistency” in Bell’s statements on this matter – as well as of “how a data service that uses the Internet is not a telecommunications service” (yes, Bell argues that its quacking duck ain’t no water fowl no how). Continue reading →
Last Wednesday was the deadline for followup comments on Ben’s Part 1 application, more accurately described as a complaint. In the text below you’ll find the main body of my intervention, minus the top and tail. I wrote about Ben’s original filing back in November: Ben Klass asks CRTC to stop Bell’s deliquency on Mobile TV. As of today, Ben’s current filing hasn’t yet shown up on the Commission’s site: I’ve uploaded it here. Of the other interventions filed this past week, two were especially critical of what Bell is being allowed to get away with. Teresa Murphy starts her comments by suggesting that Bell’s whole argument is founded on a phony distinction (para 2: her pdf is uploaded here):
It makes no sense whatsoever to treat competing services differently when the underlying technology and distribution method is the same. This is allowing vertically integrated companies to behave by one set of rules, and allowing them to treat their competitors differently, and frankly unfairly.
Yesterday, the Open Technology Institute, an initiative of the New America Foundation, released the 2013 version of its study, The Cost of Connectivity. Once again, Canada looks really bad in the rankings. And not just bad for 2013, but even worse than in 2012. (I wrote about the 2012 results last November in this post. I’ve uploaded the 2012 report here and the 2013 report here, both in pdf.)
Here’s the setup for the just-published report from this gang of lefties:
“Last year, the New America Foundation’s Open Technology Institute published The Cost of Connectivity, a first-of-its-kind study of the cost of consumer broadband services in 22 cities around the world. The results showed that, in comparison to their international peers, Americans in major cities such as New York, Los Angeles, and Washington, DC are paying higher prices for slower Internet service. While the plans and prices have been updated in the intervening year, the 2013 data shows little progress, reflecting remarkably similar trends to what we observed in 2012 (my emphasis). Continue reading →
Bernard Lord, CEO of the Canadian Wireless Telecommunications Association
“Canadians would be willing to pay more for cellular services, study says.”
If you read that headline in the Globe and Mail on Monday, did you jump to the same conclusion I did? That the CWTA commissioned a consumer survey in which they asked about price points for wireless services? And found somehow that Canadians would pay more… than they’re already paying?
It turns out you had a good reason for your cognitive dissonance. No Canadians actually said to an interviewer, yes, I’d like to pay more. That’s because there was no consumer survey, and any suggested personal agency or willingness to pay was a lobbyist’s plant, based on a piece of economic theory about consumer surplus that bears no relation whatsoever to how any person I know feels about their cellphone bill. What the Globe meant, but didn’t know so, is depicted in the graphic below. The difference in the price that consumers would be willing to pay, if they had to, and the amount they pay now, is the consumer surplus – aka I wish I could pay Bell Mobility even more.
I’ve been gathering reactions to last week’s CRTC decisions on wholesale rates for Internet access. My takeaway is a lot of people are having trouble understanding what the hell it all means. So in this series of posts I’m going to provide some plain-language context.
Today, I’m covering broadband competition, and the unusual structure of Canada’s wholesale and retail Internet access market. In the next post, I’ll look at how the CRTC arrives at wholesale costs and what that will mean for your residential bill. Finally, I’m going to focus in the third post on the UBB controversy of two years ago and how that relates to the recent rulings.
A pig in a poke
Communications services play an increasingly important role in our lives. Yet the evidence is that awareness among consumers about what they’re getting when they buy broadband is stunningly low. Continue reading →
[Was supposed to continue from Oct 15 post on Ms Motzney…]
What you’ll find in this post instead:
The Bell/Astral decision is (virtually) unprecedented
“Public” benefits now refers to “we the public” – not just dudes who make TV shows
Cabinet won’t intervene
Consumer-loving Bell shocked and outraged
CRTC watchers eat crow. Don’t you hate it when the world changes faster than you can write about it? Thursday’s triumph over Bell is wonderful for consumers; for the thesis I was developing here, not so much. The comments I’ve read – Geist (This Is Not Your Parent’s CRTC); Cartt (CRTC says “Non!”); the Globe (Ottawa says it can’t intervene in CRTC’s BCE-Astral decision); etc – all indicate the Astral decision shows Chairman Blais really does intend to build a consumer-oriented CRTC. I trust he will understand why industry watchers, present company included, had been pretty much unanimous in predicting he’d never, ever turn down Bell on this acquisition. Continue reading →
[This continues Monday’s post, which began the list of issues with 1) No neutrality, 2) No teeth, 3) No transparency.]
ITMP failing #4 – No congestion. To understand the CRTC’s ITMP policy, you have to understand the alleged problem for which it was the putative solution: traffic congestion. The incumbents pushed the congestion story relentlessly, until they finally convinced the Commission that Canada’s net neutrality framework had to address not opportunity or innovation or freedom of choice, but the problem engineers have in many walks of life – load-levelling.
The incumbents asked for the Commission’s help and got it, despite the fact they never offered any convincing empirical evidence that traffic congestion on their networks was getting out of hand. Never mind the convenient but entirely untrue fairy-tale that congestion was being caused by evil bandwidth hogs – a fairy-tale the prior CRTC chair swallowed hook, line and sinker. KvF stood by the incumbents’ version of the truth in the face of evidence that congestion occurs not because of individual anti-social behavior, but because of traffic peaks created by large numbers of users at certain times of the day – very much like vehicular traffic peaks on the 401 during rush hours. Continue reading →